The Purchasing Manager at Folding Squid Technologies Has Responsibility for Reviewing

question 33

Multiple Choice

The purchasing manager at Folding Squid Technologies has responsibility for reviewing and authorizing purchase orders.Receiving reports are prepared by shipping and receiving based on the relevant purchase order(s) .Purchase orders,receiving reports,and vendor invoices are reconciled by accounts payable,which authorizes payment.Which of the following would correct control weaknesses,if any,related to these activities?

• A) Vendor invoices should be reviewed by the purchasing manager to ensure that they are correct.
• B) Accounts payable should authorize purchase orders.
• C) Receiving reports should be reviewed and corrected by the purchasing manager.
• D) Controls are adequate under the current system.

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Definitions:

Distributors

Entities involved in the process of making products available for consumption by distributing them from producers to end consumers.

Fair Value Option

An accounting approach allowing companies to report certain assets and liabilities at fair market values rather than historical costs.

Fair Value Option

An accounting choice to measure certain financial assets and liabilities at fair market values.

Receivables Growth

An increase in the amount of money owed to a company by its customers for products or services that have been delivered or used but not yet paid for.